After months of disarray, Democrats are closing in on a bipartisan deal on financial reform — with the backing of a key Republican. The House is pushing ahead on the Senate's $15 billion jobs bill. And Democrats are claiming they have the votes to ram through the health care reform bill — while trying to minimize the explosive move to use reconciliation procedures to pass it.

And while they try to regain momentum, Democrats have a perfect boogeyman for Republican obstruction: Sen. Jim Bunning, the cantankerous Republican from Kentucky, who is blocking an extension of unemployment benefits, COBRA benefits, doctor reimbursement and other programs that both parties actually like.

If Democrats actually meet their Easter deadline on health care — a tall order — and continue to pass piecemeal jobs bills and quell the disgruntled left on any Wall Street reform deals, they will have something to sell a dissatisfied electorate heading into the fall elections.

“With movement of a jobs bill, progress on Wall Street reform and a way forward emerging on health insurance reform, we are making real progress on the issues the American people want us to address,” Majority Leader Steny Hoyer said in a statement to POLITICO.

To be sure, this could all be another false start for a Democratic Congress that has shown a remarkable ability to snatch defeat from the jaws of victory. Democrats are one filibuster, one wayward moderate or one disgruntled liberal complaint away from blowing up any of their major agenda items.

And legislative progress does not necessarily translate to electoral success in the fall. The outlook is still terribly bleak for Democrats regardless of whether they pass financial reform and a jobs bill. Health care reform remains unpopular in polls — so much so that Minority Whip Eric Cantor believes Republicans will win back the House if Democrats pass health care reform.

Republicans scoff at the idea that Democrats have picked up even the scent of momentum.

“No,” was the one-word answer from Minority Leader John Boehner’s spokesman, Michael Steel, when he was asked whether Democrats were actually making any progress.

Republicans still argue that they own the larger narrative.

“First, it’s clear that the American people are fed up with Democrats’ control of Washington,” said Cantor spokesman Brad Dayspring. “On the legislative front, to suggest that Democrats are anything but anemic would be to ignore the facts. ... Second, the ‘jobs’ bill is made up of a $13 billion tax credit that Speaker Pelosi herself called ineffective. Finally, if Democrat claims that they have the votes on health care are accurate, then they’ve already lost their majority. If they don’t have the votes, they’ve still lost their majority.”

But there’s no denying that the headlines this week show Democrats making progress on the key pillars of Wall Street reform, health care and jobs. The banner on the Wall Street Journal today read “Deal near on banking rules,” as Senate Banking Chairman Chris Dodd and Tennessee Republican Bob Corker are near agreement on a compromise version of a consumer protection agency. The two are also close to agreement on a regulator that would have the power to break up banks deemed “too big to fail,” in order to avoid more bailouts.

Democrats are exceedingly cautious about talking about any progress, realizing that a lot can go wrong once legislation reaches the Senate floor. And liberals are already getting whipped up about Dodd bailing on a more powerful Consumer Financial Protection Agency — Arianna Huffington complained in a column today that Democrats had “pre-emptively surrendered” on the consumer agency.
“We do not have an agreement yet. He hopes to have a consensus bill in the coming days,” Dodd spokeswoman Kirstin Brost said, declining to comment on any details.

But the Bunning filibuster on unemployment benefits, COBRA health benefits and highway funding has also been a gift for Democrats straight from the Republican bullpen. Bunning’s filibuster has already caused the furlough of 2,000 highway workers and may force doctors to accept a 21 percent cut in Medicare reimbursements.

Democrats privately concede these things will be fixed, reimbursements will be backdated and nobody will actually miss an unemployment check once this legislation passes, but they like using Bunning as a foil.

"He's [Bunning] like the pitcher who gave up six home runs in a row, but the manager doesn't have the ability to bench him,” says one Democratic leadership aide. “The longer he stays in, the brighter the spotlight is on Republican obstruction.”

Even if some jobs bill and a watered-down financial bill clear, however, Democrats will still be judged on the final outcome on health care reform. No sane political prognosticator is willing to predict the actual outcome of this year-long, volatile debate.

But the fact that nine House Democrats who were previously “no” votes are thinking of flipping to "yes" — as reported by the AP this morning — is a sign that Pelosi’s arm twisting may be working on health care.

“Whether working to grow the economy and helping to create jobs or working to pass legislation to provide affordable health care while holding insurance companies accountable, our focus is on delivering results,” Pelosi spokesman Nadeam Elshami said.